The Swift-Boating of Yahoo!

(Full disclosure: Yahoo! is a long-time Upstream customer, but I’m not consulted on — or privy to — any of their long range M&A plans. No one at Yahoo! was consulted on this edition of The Drift, and the opinions expressed are solely my own.)

If you’re a political junkie like me, you may be familiar with a presidential campaign documentary called “Journeys with George” that takes you inside the lives of the press corps following then-Governor George Bush’s presidential bid. Regardless of your political leanings (the filmmaker was Alexandra Pelosi, daughter of Democratic House Minority Leader Nancy Pelosi) it was impossible not to be charmed by the personal charisma of then-candidate W. But near the end of the film – once Bush has been elected and the members of the campaign press-corps are effectively kept far away from him – one reporter makes a chillingly incisive comment:

“So much of this has been a kind of pack journalism – everyone making sure they’ve got the same stuff as everybody else. I’ve just got this kind of nagging feeling that the press wasn’t always doing the right thing. The Gore press corps was all about how they didn’t like him (Gore) and didn’t trust him and that kind of filtered through to the stories. And we (the Bush press corps) were writing about trivial stuff because he (Bush) charmed the pants off of us.”

This column isn’t about politics; it’s about how reporting is no longer really about the truth, but rather about the story line. A good, simple story line will trump good reporting every time. A good story line entertains and makes the reader/viewer feel smarter and more certain about the world. Reporting is expensive and frustrating and often inconclusive. So journalists today sniff out the story line early, find “facts” to support it, and then it simply bounces back and forth between the bloggers and the mainstream press. And while political reporters might ask a couple of extra questions this election season, it seems that business reporting is firmly stuck in the echo chamber.

Today’s simple Internet story line goes like this: Google is the source of all good things in the digital world; the company that can literally do no wrong. Google is the charming politician who people just want to like. One needs only look at Fortune’s recent piece “Chaos by Design” (http://money.cnn.com/magazines/fortune/fortune_archive/2006/10/02/8387489/index.htm?postversion=2006100210) to see the celebration in full flower. In the story, Larry Page thanks a manager for her multi-million dollar mistake (“I’m so glad you made this mistake… Because I want to run a company where we are moving too quickly and doing too much, not being too cautious and doing too little. If we don’t have any of these mistakes, we’re just not taking enough risk”) and the business operations guru celebrates chaos as a virtue. With the story framed this way, every product that fades into oblivion (Google Local, Froogle, Google Print, et al) becomes a badge of innovation, every failed business deal a triumph of experience. When objectivity is suspended, failure ceases to exist as a story element.

Unless you’re Yahoo! The other side of today’s simple story line features Yahoo! as the wounded, dancing bear. Gosh they just can’t seem to get anything right! Poor Yahoo! What’s become of them? It’s Yahoo! as Al Gore, circa September 2000. Last week, Saul Hansell of The New York Times played this out in a piece of reportage (“Yahoo!’s Growth Being Eroded by New Rivals”) (http://www.nytimes.com/2006/10/11/technology/11yahoo.html?_r=2&th&emc=th&oref=slogin&oref=slogin) that accepts and supports virtually every negative assumption about Yahoo!. Hansell notes that Yahoo! “…has suffered some embarrassing setbacks in its sales of both display and Web search advertising.” True that Yahoo! lags well behind Google in terms of both search dollars and the monetization of search results, but last I looked Yahoo! was still the dominant player in online display advertising, raking in a huge share of all the marketing dollars currently invested in the online channel. Slowing growth? Well, that tends to happen when you’ve got a huge market share, doesn’t it? The New York Times article then helpfully points out that “Many advertising industry executives say Yahoo!’s lead in working with big marketers has eroded as other companies have built up popular Web sites, sales operations and advertising technology.” Huh? To support this new conventional wisdom he quotes David Cohen, senior vice president at Universal McCann, about Yahoo!’s shrinking lead. This is the same Universal McCann that handles advertising for MSN, a big Yahoo! competitor.

Let’s suppose for a minute that Yahoo! — not Google — had done a deal for YouTube last month, as has been widely speculated (but never confirmed… there goes that darned echo chamber again.) How would the business press have reported it? “Yahoo! Does Desperation Deal for Video Site” or “Yahoo! Bets 15% of Cash Reserves to Try to Keep Up with Google.” You see how it works? The same fiscal discipline and considered judgment that put Terry Semel on the cover of Business Week for Yahoo!’s miraculous turnaround is now being portrayed as slow-footed stodginess. Framing is what it’s all about. And today we’re being served up a story that’s been very poorly framed.

Memo to the business press: Take a breath. The truth is that both Google and Yahoo! are really good companies with smart people and some pretty terrific assets. You do a disservice to both — and to your readers — by canonizing one and Swift-Boating the other. They’re also different enough from one another that they don’t need to be cast as hero and villain. Maybe if you do your jobs and read something besides the stock ticker and each other’s stories, you’ll realize the digital future is plenty big enough for two..